Tuesday, 19 January 2016

Connecting Companies: Strategic Partnerships for the Digital Age

Connecting companies: Strategic partnerships for the digital age is a report from The Economist Intelligence Unit (EIU), sponsored by Telstra. It is designed to guide senior executives through the global trend for digital partnerships between organisations, which are connecting regions, crossing industries and linking generations. Specific industry analysis can be found in separate briefings that accompany this report.

This report draws on two main sources for its research and findings:

In June 2015 The Economist Intelligence Unit surveyed 1,044 senior business leaders, half (51%) of whom are C-level executives or board members.

Geography: Survey respondents come from across the world, with 48% based in the Asia-Pacific region; 33% in Europe, the Middle East and Africa; and 19% in the Americas. There is a minimum of 75 respondents from each of the following countries: China, France, Germany, India, Indonesia, Japan, the UK and the US.

Industry: A total of 20 industries are represented in the survey with at least 80 respondents coming from each of the following six industries: entertainment, media and publishing; financial services; healthcare; IT & technology; manufacturing; and professional services.

Company size: The sample is evenly split between firms with annual revenue over US$500m and below US$500m.

Alongside the survey, The Economist Intelligence Unit conducted a series of in-depth interviews with the senior executives and experts

Executive Summary:

Digital technology is blurring the distinctions between companies and industries as we know them. “Offline” companies in older industries – those that came to the Internet later in life – are looking to develop digital capabilities by partnering with those that have perfected them. Native online companies, for their part, are learning to value the product and service expertise of offline firms as they attempt to turn rapid growth into mature, profitable and sustainable business models – or simply to survive. The result is the rise of digital partnerships.

The form of these digital partnerships ranges from contract-based alliances between two or three players to cross-industry networks and large, loosely organised, ecosystems based on a dominant technology platform. The early adopters already have multiple digital partners and some belong to more than one form of partnership. Many others, meanwhile, are intent on catching up. Private-sector organisations tend to dominate these partnerships, although the prominence of state-owned enterprises in Asia points to closer government involvement over time.

This report finds that the growing trend for digital partnerships is already having a measurable impact for the organisations involved in them. One-half of the 1,044 executives surveyed by The Economist Intelligence Unit for this study believe that their digital partnerships have proven their value “beyond doubt”. Expectations for the future are even grander. Key findings from the research include the following:
  • Accessing the connected customer is core to the digital-partnership strategy
  • Executives embrace “strength-in-numbers” to manage change
  • Companies have high expectations of digital partnerships, but patience is required
  • Speed and specialisation are set to promote growth of cross-industry ecosystems
  • Traditional companies are learning how to share information, but some walls remain
  • Digital natives are joining partnerships for profit, not philanthropy
  • People and geography matter, as long-distance relationships prove difficult
  • The popularity of APIs foretells the rise of collaborative innovation
  • Today’s digital partnerships point to bigger changes to come
Full Report

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